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Resources on Oil Industry Windfall Profit Taxes

1 min read

With gas prices on the rise, members of Congress have renewed calls for a “windfall profit” taxA tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. on U.S. oil companies. However, previous Tax Foundation research cautions against these taxes, illustrating that they are both economically harmful and a poor revenue source.

“America’s last experiment with windfall profits taxes in the 1980s proved to be economically harmful,” said staff economist Jonathan Williams. “The tax not only failed to raise a fraction of the revenue forecasted, but also stunted domestic oil production.”

For previous research on windfall profits, please see the following:

Tax Foundation Commentary and Op-Eds

Tax Foundation Analysis and Studies

Studies from Other Organizations

For more on gas prices and taxes, please visit our Gasoline Taxes section.